Crafting the Supply Chain

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Savvy supply chain management steers CraftWorks Holdings into the future

With nine distinct specialty restaurant brands serving the nation, CraftWorks Holdings knows a little something about the power of dynamic supply chain management. Their brands include Logan’s Roadhouse, Old Chicago Pizza and Taproom, Rock Bottom Restaurants and Breweries, and Gordon Biersch Brewery Restaurants, as well as a slate of high-concept eateries such as ChopHouse, Seven Bridges Grill and Brewery, and A1A Ale Works.

In November of last year, CraftWorks Restaurants and Breweries acquired Logan’s Roadhouse to form CraftWorks Holdings, a unified platform for their brands. In 2016, prior to its acquisition by CraftWorks, Logan’s reorganized under Chapter 11 to emerge with a new leadership mindset across all functions.

At the nexus of these identities is Logan’s Roadhouse former Chief Supply Chain Officer, Randy Scruggs. As CraftWorks’ CSCO, Scruggs and his teams pull together a complex network of commodity and specialty suppliers and distributors to serve 390 locations in 40 states and the District of Columbia. As one of only two members of the holding company’s leadership group to have worked through Logan’s reorg, Scruggs lends a valuable perspective to the brands journey.

“We knew we had a really workable brand that we all believed in, we had just not done the brand justice,” Scruggs said of Logan’s, adding that deficiencies spread across product selection, labor management, and culture. “Luckily, our Leadership Team knew that to turn the brand around we needed to walk back a lot of the changes that the brand had done to try to keep up with the times, cut costs, or manage a P&L over some of the harder years that casual dining went through.

“We had a good feel for the legacy brand position, and we all agreed that we were in love with the brand that we started with, and began taking baby steps that will put us back in the scenario with the food quality, menu offerings, and our hospitality expectations. That's the foundation we rebuilt Logan's on. Through that success over the course of 2017 and 2018 it opened the door for our acquisition by CraftWorks at the end of last year.”

The play demonstrated the capabilities of the turnaround team and demonstrated a good track record of performance that made Logan's an attractive acquisition model for a company that needed some additional leadership. “Where there were voids on CraftWorks’ legacy side of the business, there were strengths on the Logan’s side of the business. Pairing the companies together worked well. We are a very strong company now post acquisition, and we're still in the integration process,” he noted.

“When you have specialty restaurants that couldn't be more different spread out all over the country, the logistic efficiency has to be tackled with a completely different mindset,” Scruggs stressed. “Each brand is different around last-mile distribution, product amount, and distribution centers, so you have to go after your efficiencies across the brands a lot differently.”

One particular challenge was to get those synergies without sacrificing brand identity for cost savings. “A lot of times that's how companies are managed. We're trying to change that model, and operate the supply chain from both a guest facing and customer facing standpoint. My customers are our operators, our marketing team and culinary folks. We have to do what's right for them to allow them to successfully drive guest satisfaction and sales from each of their unique brands — even if it's not convenient from a supply chain standpoint — then we have to mold what they need into the most efficient model in the background. Taking that challenge on — which on the CraftWorks side of the business is much more complex than it was with Logan's — it's been our biggest challenge, but it's been great and we've enjoyed doing it. We’re trying to leverage business partnerships rather than having the same items in every restaurant.”

A partnership with Arrowstream for the company’s data management needs is under way. “It allows us to leverage our data aggregation. It will give us real-time access to what prices are hitting the restaurant, where contracts are, it will house that information. It will give us all our product movement information, and a lot of analytic tools with what’s happening with product movement into the restaurant, along with giving us visibility into the distribution centers to see where we have risk moving forward.”

Perhaps the biggest risk from Scruggs POV is to manage CraftWorks Supply Chain as a cost savings function and lose sight of guest satisfaction. “We don't operate our business that way and we don't operate our supply chain that way, and that's one of my favorite things about working here,” he exhorted.

“When I sit down with the CEO, we don't talk about how we’ll save money on food costs next year, we always talk about what we can do differently to drive guest satisfaction and to empower our operators to drive sales. I rarely talk to him about cost savings. It doesn’t mean we don’t have them, we certainly do. We're constantly looking for them but we look for them through efficiencies. When we sit down with our culinary team and evaluate a recipe and say, ‘If we make a tweak here we end up with a better experience for our guests, and by the way, we might save a little on the recipe cost.’ That’s the ultimate win-win for us.”